Benefit cap

This article is about the limit on the benefit that an individual household can claim. For the limit on total government welfare spending, see welfare cap.

The benefit cap is a UK welfare policy that limits the amount in state benefits that an individual household can claim per year. It was introduced by the Cameron–Clegg coalition government in 2013[1] as part of the coalition government's wide-reaching welfare reform agenda which included the introduction of Universal Credit and reforms of housing benefit and disability benefits. The government cited wide public support for the measure, despite it being highly controversial.[2] The benefit cap primarily affects families with children, high rents, or both.[3] By 2024, two-thirds of the families affected by the cap were single-parent families, half of which had a child under five.[4]

A two-child policy restricting child tax credit and universal credit was introduced in 2017. It limits these benefits to the first two children in most households, and is referred to as the "two-child benefit cap".[5] These two benefit caps form part of a set of three benefits policies designed by the then Chancellor of the Exchequer, George Osborne, as part of the United Kingdom government austerity programme. The third policy, introduced in 2013, was known as the bedroom tax.[4]

  1. ^ "'Thousands' hit by government benefit cap now in work". BBC News. 6 February 2014.
  2. ^ Kennedy, Steven; Wilson, Wendy; Apostolova, Vyara; Keen, Richard (21 November 2016). The Benefit Cap (Report). House of Commons Library. pp. 3, 8–9, 14. Retrieved 7 August 2020.
  3. ^ Emmerson, Carl; Joyce, Robert (20 April 2023). "What impact did lowering the benefit cap have?". The Institute for Fiscal Studies.
  4. ^ a b Butler, Patrick (31 July 2024). "Benefit cap traps families in crowded, rat-infested homes, report finds". The Guardian.
  5. ^ Lawrie, E., Two-child benefit cap: 'Every month is a struggle', BBC News, published 31 January 2024, accessed 17 June 2024